Gowex staff mull legal action as CEO admits to false accounting

Let's Gowex staff denied any knowledge about irregularities in the Spanish Wi-Fi provider's finances that have resulted in the company going bust, and said they are considering legal action over the matter.

The company's workers said they were shocked to discover that managing director, Jenaro García, lied to them about the state of the company's finances, after U.S. investment company Gotham City Research alleged Gowex had filed false accounts.

In an emailed statement, Gowex staff revealed they had been working to disprove the claims, "being convinced that the accusations were false, as the company's managing director transmitted to us."

Despite initially denying the claims of false accounting--Gowex ratified its 2013 earnings in a statement on July 2--Garcia conceded at the weekend that the Gotham City Research report was accurate, and revealed that the false accounts covered a four-year period. Gowex' board subsequently filed for bankruptcy, explaining in a stock market statement that it is concerned the company "might not be in a position to face its ongoing debts when they become due."

The admission left staff "in a state of complete shock," and in fear for their future.

"We have ongoing projects with grants for several years, so we are concerned about the customers affected and the damage to our image as professionals, and, also, being linked with some conducts where we just are one more affected part and which we categorically reject," the staff stated, adding. "We dissociate ourselves radical and totally of these facts, and we are considering in taking legal actions as affected part and victims of this situation," they added.

Deutsche Telekom, which signed a Wi-Fi hotspot sharing deal with Gowex in 2013, is now considering switching to a new partner, Bloomberg reported. AT&T, another Gowex partner, made no comment on its future plans, the news agency added.

Garcia appeared to shoulder full responsibility for the fraud in Twitter messages, where he called for forgiveness and pledged to cooperate with the authorities, sister publication FierceWireless:Tech reported.

Gowex staff ended by calling for "support and prompt action by the authorities, who we trust, due to our helpless situation."

For more:
- see Gowex's stock market statement
- read Bloomberg's report
- see FierceWireless:Tech's report
- see Gowex's recent earnings statement

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